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CONCORD, N.H.—New Hampshire's House adopted an anti-union measure Wednesday night that is intended to give the state and municipalities an edge in contract negotiations.

The key vote came on an effort by Democrats to delete the provision in a companion bill to the Republican-led House's proposed $10.2 billion budget. The effort lost 201-155.

Labor unions are galvanized against the proposed policy change that attempts to force public employees to make major concessions at the bargaining table before their contracts expire or become at-will employees, whose wages and benefits can be changed by employers.

State Rep. Neal Kurk, a Weare Republican and the amendment's sponsor, said the state needs the extra edge to pressure state workers' unions into making $50 million in concessions in wages and benefits.

Kurk said the state might have to lay off 350 people if the concessions aren't made.

"Without this amendment, the budget likely will be $50 million short or be incapable of being carried out because the employees to do the work won't be there," he said.

Supporters argued it effectively would cripple collective bargaining.

"This would give no incentive for an employer to reach an agreement. No incentive at all," said state Rep. Ben Baroody, D-Manchester.

State Rep. Shawn Jasper, R-Hudson, countered that unions would still exist and the two sides could still seek arbitration to settle differences. But he also said it would give voters the ability to reject teachers' and other public workers' contracts at the polls. He said no government body would lay off its entire work force even if they become at-will workers.

State Rep. Stephen DeStefano, D-Bow, disagreed.

"At-will means I can fire anyone at-will for no reason," he said.

The proposal drew 400 union members to the Statehouse last week to watch the House budget committee insert it into the budget package. At times, members in the crowd shouted at the committee, prompting increased security around the Statehouse on Wednesday.

Several thousand union members and advocates for the poor are expected at a rally Thursday to protest the anti-union measure and spending cuts in the House budget. The House passed the anti-union measure in a companion bill to the budget, along with other policy changes needed to implement spending changes in the budget. The budget bill is being voted on on Thursday.

The union provision faces an uncertain future in the Senate.

Democrats also tried unsuccessfully Wednesday to stop changes to the state pension system, repeal of a program for troubled youth, highway fund spending changes and cuts to payments to hospitals for caring for the poor.

And they unsuccessfully tried to stop Republicans from suspending a 200-year-old requirement for communities to provide the aid as long as current welfare budget amounts are maintained over the next two years. House budget writers did this so cuts at the state level would not fall on communities, but critics say that leaves people with only family, friends or churches to turn to.